| [2015] FWC 1267 |
| FAIR WORK COMMISSION |
DECISION |
Fair Work Act 2009
s.394—Unfair dismissal
Clinton Vallence
v
Darlea Pty Ltd T/A Sawtell Coaches
(U2014/14567)
VICE PRESIDENT LAWLER |
SYDNEY, 5 MARCH 2015 |
Application for relief from unfair dismissal.
[1] The Respondent operates a bus company that services the Sawtell area of northern NSW. The Applicant was employed by the Respondent as a diesel mechanic on 8 April 2013.
[2] The Respondent’s business was owned by Mr Rex Williams and his wife. Mr Rex Williams had withdrawn from the business some eight years ago and taken up farming, some hours drive away from Sawtell. Their son, Mr Darren Williams, had managed the business since that time.
[3] On 15 September 2014 the Applicant prepared a letter entitled “resignation letter/....formal complaint letter”. The draft was sent to his sister to correct spelling and emailed to the Respondent the following day, 16 September 2014.
[4] The letter (Exhibit 1, attachment) opens:
“I wish to give notice for resignation from employment at your company with a notice period of 2 weeks as of today’s date, making my last working date ......... or
I can remain employed until you find a suitable replacement for myself as all the rego’s are due and I do not wish to leave you short staffed.”
This is a verbatim extract of the letter.
[5] That letter was sent to the employer on 16 September 2014. Two weeks from that date was 30 September 2014. However, note that, by its terms, the offer to make the resignation effective upon the finding of a suitable replacement at the employer’s option.
[6] Under a bold heading “My reasons for resignation” the Applicant listed two main reasons:
[7] Another employee, Mr F, was the focus of the Applicant’s complaints. Mr F worked in the yard and did not have any supervisory role over the Applicant. The resignation letter makes it clear that “screaming and shouting” from Mr F on 15 September 2014 was the precipitating event for the resignation. The letter states “the intimidation and threatening behaviour in the workplace is getting beyond a joke.”
[8] Mr F was not called as a witness. I accept the Applicant’s evidence that he was subjected to abuse, bullying and harassment from Mr F and that he had made complaints about this to Mr Darren Williams and that no effective action was taken to deal with the problem.
[9] The resignation letter concludes:
“I have mentioned that I would not take the persons temper fits much more on a number of occasions and will no longer deal with it.
For as long as this persisting problem goes on you will never hold on to a mechanic.”
This is a verbatim extract of the letter.
[10] That same day, 16 September 2014, the Respondent placed advertisements for a mechanic in various newspapers (Exhibit C).
[11] On 17 September 2014 Mr Darren Williams sent a letter accepting the Applicant’s resignation (Exhibit A, attachment):
“Re - Resignation Letter
Sawtell Coaches confirms receipt of your letter of resignation on Tuesday 16th September 2014, and accepts your written resignation.
Your comments within your letter have been noted and Sawtell coaches wish to advise that we will be engaging a third party to act as an informal adjudicator to facilitate amicable resolution.
Sawtell Coaches wishes to thank you for your efforts within the business to date and hope you have ongoing success in your future endeavours.”
This is a verbatim extract of the letter.
[12] Later on 17 September 2014 the Applicant, having thought better of his decision to resign, spoke to Mr Darren Williams and indicated that he wished to withdraw his resignation.
[13] The Applicant gave evidence that Mr Darren Williams verbally agreed to that withdrawal of resignation. Mr Darren Williams gave evidence that he told the Applicant clearly that he would need to put his request “in writing” before it could be considered. No such written request was made by the Applicant. Mr William’s evidence was corroborated by a staff member who witnessed the exchange (Exhibit E).
[14] A Centrelink employment separation certificate was prepared by the employer (Exhibit 2). Item 2 on the certificate obliges the employer to specify the “Reason for Separation”. The form has a box for “Employee ceasing work voluntarily”. That box was not ticked. Instead, the box entitled “Other” was ticked.
[15] While I have generally accepted the evidence of the Applicant, on this issue I prefer the evidence of Mr Darren Williams, corroborated, as it is, by the evidence of Ms Gottsche - and notwithstanding the Centrelink certificate prepared and signed by Ms Gottsche. I find on the balance of probabilities that the Applicant’s request to withdraw his resignation was met with the response that he should put his request in writing and that this did not occur.
[16] The Applicant gave the following account in his statement, Exhibit 1:
9. On 17 September 2014, on being handed the letter of the Respondent, I verbally withdrew my resignation with Darren Williams of the Respondent. A conversation took place with words to the following effect:
I said, “Darren, I handed in my resignation in the heat of the moment. I wish to retract my resignation.”
Darren said, “Clint, I’m happy for you to retract your resignation. It will save us time and money to find another mechanic.”
10. At no time was I requested, by either Darren Williams or any other representative of the Respondent, to provide my withdrawal of resignation in writing.
11. I continued to work for the Respondent on an ordinary basis after my withdrawal of resignation was accepted.
[17] As noted, I prefer the evidence of the Respondent’s witnesses to the assertion in paragraph 10.
[18] The Respondent was the subject of an unannounced inspection of the roadworthiness of its buses by an official of the regulator, RMS. A large portion of the fleet was the subject of defect notices. This produced a crisis for the business because there were insufficient buses to meet the Respondent’s contractual commitments.
[19] Mr Darren Williams was finding it difficult to cope with the crisis and Mr Rex Williams was summonsed by his daughter-in-law to help out. Mr Rex Williams drove from the farm to the business, arriving on the afternoon of Thursday 2 October 2014. Mr Darren Williams went home and remained there. Mr Rex Williams assumed management of the Respondent in his son’s absence.
[20] Mr Rex Williams gave evidence of a conversation with the Applicant upon his arrival at the Respondent’s depot, claiming that the Applicant said to him words to the effect “I will stay until you find another mechanic.” Mr Rex Williams stated that he was unaware of the Applicant’s resignation at the time of this conversation.
[21] A major effort was undertaken to address the various defects in the buses.
[22] Mr Rex Williams asked the Applicant to work on the weekend of 4-5 October 2014. The Applicant agreed and worked long hours on both those days performing repairs on buses.
When the Applicant presented for work on Tuesday 7 October 2014 (Monday 6 October 2014 was a public holiday) Mr Rex Williams handed him a letter of termination (Exhibit D, attachment), stating:
“You gave your resignation letter to the Manager on 15th September 2014.
An acceptance letter was given to you on Wednesday 16th September 2014.
You verbally advised the manager that you wished to rescind your resignation in writing and to date this has not been forthcoming.
Sawtell Coaches wish to advise that today will be your last day of employment with Sawtell Coaches. ...”
[23] The Applicant was directed to leave the premises immediately.
[24] The Applicant stated:
12. On the weekend of 4 and 5 October 2014, I worked in excess of 13 hours to help the Respondent. I would not have worked all weekend to help the Respondent if my withdrawal of resignation had not been accepted. I worked all weekend to help out the Respondent only to be dismissed without reason two days later.
13. On 7 October 2014, Rex Williams gave me a letter dated 7 October 2014, which stated that 7 October 2014 would be my last day of employment with the Respondent. When Rex Williams handed me the letter dated 7 October 2014, he asked me to leave the grounds immediately. A conversation took place with words to the following effect:
I asked Rex, “Why am I being fired? I retracted my resignation a few weeks ago.”
Rex replied to me, “I don’t care, you’re gone.”
I asked, “Why?”
Rex replied to me, “I have to be seen to be doing something to save my company.”
[25] In cross-examination, Mr Rex Williams did not seriously dispute that there was a conversation to the effect of that set out in paragraph 13 (Transcript PN528-9) and I find that such a conversation did occur. While that conversation demonstrates that Mr Rex Williams had a hostile animus towards the Applicant, this is beside the point.
[26] A resignation, once accepted, cannot be unilaterally withdrawn. On the findings I have made, there was no agreement by the Respondent to his request to withdraw his resignation.
[27] In his written statement, Exhibit D, Mr Rex Williams stated that he did not become aware of the Applicant’s resignation until after 30 September 2014 when he began managing the business during his son’s absence on an overseas trip. He stated that some time between then and 7 October 2014
“...the Applicant did indicate that he was considering withdrawing his resignation.
I said to him that if he is considering that, he must put it in writing as that is essential before it is considered.”
[28] Mr Rex Williams’ witness statement has an account of how he came to resume managing the business that makes no mention of the problems with the buses. The Applicant denied any such conversation. I prefer the evidence of the Applicant.
[29] The Commission has no jurisdiction to deal with an application for an unfair dismissal remedy unless there was a termination at the initiative of the employer (s.386(1)(a)). This case turns on whether, in the particular factual situation, the Applicant’s employment was terminated “at the initiative of the employer”.
[30] In essence, the Applicant’s position was that he found workplace bullying that he had been experiencing and other management failings intolerable and, with his many complaints ignored, he was left with no option but to resign.
[31] The law has long recognised that employees may be forced to resign by their employer and that a termination in such circumstances should be regarded as being at the initiative of the employer. This is now addressed in the s.386(1)(b) of the Fair Work Act:
(1) A person has been dismissed if:
(a) the person’s employment with his or her employer has been terminated on the employer’s initiative; or
(b) the person has resigned from his or her employment, but was forced to do so because of conduct, or a course of conduct, engaged in by his or her employer.
(2) However, a person has not been dismissed if:
(a) the person was employed under a contract of employment for a specified period of time, for a specified task, or for the duration of a specified season, and the employment has terminated at the end of the period, on completion of the task, or at the end of the season; or
...
[32] The Explanatory Memorandum relevantly states:
1528. This clause sets out the circumstances in which a person is taken to be dismissed. A person is dismissed if the person’s employment with his or her employer was terminated on the employer’s initiative. This is intended to capture case law relating to the meaning of ‘termination at the initiative of the employer’ (see, e.g., Mohazab v Dick Smith Electronics Pty Ltd (1995) 62 IR 200).
1529. Paragraph 386(1)(b) provides that a person has been dismissed if they resigned from their employment but were forced to do so because of conduct, or a course of conduct, engaged in by their employer. Conduct includes both an act and a failure to act (see the definition in clause 12).
1530. Paragraph 386(1)(b) is intended to reflect the common law concept of constructive dismissal, and allow for a finding that an employee was dismissed in the following situations:
[33] I am satisfied that the Applicant’s complaints about the treatment which he was being subjected and his other concerns, including the sabotage of buses, were made genuinely and with a proper foundation. I am satisfied that the Respondent failed to act properly on those complaints and that such failure can constitute a course of conduct by omission.
[34] Moreover, it was clear from the evidence of Mr Rex Williams that he had firmly concluded that the Applicant was responsible for “dobbing in” the Respondent to the authorities leading to the crisis described above. I am satisfied on the balance of probabilities that his actions on Tuesday 7 October 2014 were motivated by that belief. I am satisfied on the evidence before me that the Applicant was not responsible for the complaint that led to the surprise inspection. The Applicant gave compelling oral evidence that he was not responsible for the complaint. It was clear within the hearing room that Mr Rex Williams remained unmoved by that evidence.
[35] However, I am unable to find that the Applicant was “forced” to resign on 16 September 2014. I am conscious that the reference to a “course of conduct” in s.386(1)(b) is apt to encompass a course of conduct such as bullying which leaves an employee with no reasonable choice but to resign. However I am not satisfied that the legislature intended s.386(1)(b) to be operative merely because an employee has a justifiable perception that they are being subjected to bullying or unfair treatment. Employees will often find their work environment unpleasant, object to the behaviour of other employees and feel dissatisfaction in management’s response or lack thereof. A resignation motivated by such dissatisfaction cannot reasonably be characterised as one “forced” by the employer unless there is some evidence that the “course of conduct” was designed or intended by the employer to procure the employee’s resignation or that the effects of the bullying or unfair treatment involved in that course of conduct presented an immediate and material risk to the employee’s physical or mental health. It is only in such circumstances that an employee can properly be said to have had no reasonable choice but to resign. To hold otherwise would allow any employee who is dissatisfied with a course of conduct affecting them in the workplace to contend that their resignation was forced. The legislature cannot have intended that outcome.
[36] In the present case there is no evidence that the “course of conduct” relied upon by the Applicant was designed or intended by the Respondent to procure the Applicant’s resignation or that the effect of the course of conduct on the Applicant was so great as to leave him no reasonable alternative but to resign. Accordingly, I am not satisfied that the Applicant was “forced” to resign, within the meaning of s.386(1)(b), on account of the treatment referred to in his letter of resignation/letter of complaint.
[37] However, that is not the end of the matter. In Ngo v Link Printing Pty Ltd (1999) 943 IR 375 at para [12] a Full Bench of the AIRC considered “the decisions that assert the existence, in certain circumstances, of a duty to clarify a resignation” and adopted the following analysis of Murphy JR in Minato v Palmer Corporation Ltd [(1995) 63 IR 357 at 361-2]:
“The legal position was set out in the case of Sovereign House Security Services Ltd v Savage [1989] IRLR 115 where at 116 May LJ said:
‘In my opinion, generally speaking, where unambiguous words of resignation are used by an employee to the employer direct or by an intermediary, and are so understood by the employer, the proper conclusion of fact is that the employee has in truth resigned. In my view tribunals should not be astute to find otherwise ...
However, in some cases there may be something in the context of the exchange between the employer and the employee or, in the circumstances of the employee him or herself, to entitle the tribunal of fact to conclude that notwithstanding the appearances there was no real resignation despite what it might appear to be at first sight.’
[38] Those comments were considered in another case: Kwik-Fit (GB) Ltd v Lineham [1992] ICR 183 where at 188 Wood J said that he saw no difference in principle between words or actions of resignation. At 191 he set out the position as follows:
“If words of resignation are unambiguous then prima facie an employer is entitled to treat them as such, but in the field of employment personalities constitute an important consideration. Words may be spoken or actions expressed in temper or in the heat of the moment or under extreme pressure (‘being jostled into a decision’) and indeed the intellectual make-up of an employee may be relevant: see Barclay v City of Glasgow District Council [1983] IRLR 313. These we refer to as ‘special circumstances’. Where ‘special circumstances’ arise it may be unreasonable for an employer to assume a resignation and to accept it forthwith. A reasonable period of time should be allowed to lapse and if circumstances arise during that period which put the employer on notice that further inquiry is desirable to see whether the resignation was really intended and can properly be assumed, then such inquiry is ignored at the employer’s risk. He runs the risk that ultimately evidence may be forthcoming which indicates that in the ‘special circumstances’ the intention to resign was not the correct interpretation when the facts are judged objectively.”
[39] It was objectively clear on the face of the Applicant’s letter that his resignation was a protest at the Respondent’s inaction in relation to the material matters about which he was complaining. Mr F was at the centre of his first primary complaint. It should have been obvious to Mr Darren Williams that the Applicant’s resignation was the product of his frustration at the issues he complained about in his letter. The Applicant acted quickly in seeking to withdraw his resignation. I am satisfied that the ‘special circumstances’ of the kind referred to in Ngo exist in this case and that it was unreasonable for Mr Darren Williams to act on the resignation forthwith, let alone insist that the Applicant’s request to withdraw his resignation be in writing. The Respondent arranged for mediation between Mr F and the Applicant after the letter of resignation had been received, a pointless exercise if the Respondent was intending to act on the resignation.
[40] Alternatively, I am satisfied that the Applicant verbally informed both Messrs Williams that he wished to withdraw his resignation which was due to take effect on 30 September 2014 unless the employer requested the Applicant to remain in employment until his replacement was found, albeit that, on the evidence, there was no written request of that kind.
[41] In that context, the conduct of the Respondent in allowing the Applicant to continue working past 30 September 2014, and then requesting him to work on the weekend of 4-5 October 2014, without confirming that his employment would only continue until his replacement was secured, was conduct on the part of the Respondent that, objectively determined, involved an acceptance of the Applicant’s withdrawal of his resignation (notwithstanding Mr Darren Williams’ insistence on 17 September 2014 that a request to withdraw the resignation should be put in writing) that effected a restoration of the ongoing employment relationship between the parties.
[42] It is tolerably clear that Mr Rex Williams terminated the Applicant on 7 October 2014 because of his belief (without evidence) that it was the Applicant who had “dobbed in” the Respondent to RMS and, having used the Applicant to assisting in dealing with the defect notice crisis, terminated him for that perceived ‘misconduct’. I use inverted commas because it is not clear that a report to RMS in relation to safety issues that were not being addressed by the Respondent would involve misconduct on behalf of the Applicant, however much it may have enraged Mr Rex Williams.
[43] For these reasons I find that there was a termination at the initiative of the Respondent employer.
[44] I am required to consider the matters specified in s.387.
(a) whether there was a valid reason for the dismissal related to the person’s capacity or conduct (including its effect on the safety and welfare of other employees)
The Applicant was terminated for suspected ‘misconduct’ that is not established by the evidence. There was no valid reason for the dismissal.
(b) whether the person was notified of that reason
The applicant was not notified of that reason.
(c) whether the person was given an opportunity to respond to any reason related to the capacity or conduct of the person
There was no opportunity to respond to the suspected ‘misconduct’.
(d) any unreasonable refusal by the employer to allow the person to have a support person present to assist at any discussions relating to dismissal
There were no discussions relating to the dismissal.
(e) if the dismissal related to unsatisfactory performance by the person—whether the person had been warned about that unsatisfactory performance before the dismissal
The dismissal did not relate to unsatisfactory performance.
(f) the degree to which the size of the employer’s enterprise would be likely to impact on the procedures followed in effecting the dismissal; and (g) the degree to which the absence of dedicated human resource management specialists or expertise in the enterprise would be likely to impact on the procedures followed in effecting the dismissal
The Respondent is not a large business and has no dedicated human resource management specialists. These matters would be likely to impact on the procedures followed in effecting the dismissal.
(h) any other matters that FWA considers relevant
I have taken account of the Applicant’s age and duration of employment, along with all of the circumstances of the matter.
[45] In the circumstances, I am satisfied that the dismissal was harsh, unjust or unreasonable.
[46] As is obvious from the circumstances, reinstatement is not an appropriate remedy. I am satisfied that compensation in lieu of reinstatement is appropriate. I am obliged to consider the matters specified in s.392(2).
(a) the effect of the order on the viability of the employer’s enterprise
There is no evidence that an award of compensation will imperil the viability of the employer’s enterprise.
(b) the length of the person’s service with the employer
The Applicant’s length of service was relatively short - less than a year and a half.
(c) the remuneration that the person would have received, or would have been likely to receive, if the person had not been dismissed
The Applicant was earning at a rate of $1,160 per week (see Exhibit 2). The Applicant would have continued receiving this remuneration for a period had he not been dismissed. It is difficult to conclude that the Applicant would have remained in long term employment with the Respondent if he had not been dismissed.
(d) the efforts of the person (if any) to mitigate the loss suffered by the person because of the dismissal
I am satisfied that the Applicant had made reasonable attempts to mitigate his loss but had been unsuccessful in obtaining alternative work as at the time of the hearing.
(e) the amount of any remuneration earned by the person from employment or other work during the period between the dismissal and the making of the order for compensation; and (f) the amount of any income reasonably likely to be so earned by the person during the period between the making of the order for compensation and the actual compensation
As at the date of the hearing the Applicant had been unable to find alternative employment notwithstanding applying for a number of jobs.
(g) any other matter that FWA considers relevant
I have considered all the circumstances of the case.
[47] In all the circumstances, I do not consider it appropriate to award compensation in the amount of the cap and consider that an amount of $20,000 as compensation in lieu of reinstatement is appropriate. In other words, I am not satisfied that an order in the cap amount is appropriate. An order to that effect will issue with this decision.
VICE PRESIDENT
Appearances:
Ms R Heffernan of Coastal Law & Conveyancing for the applicant
Mr K Oliver of Robson & Oliver Solicitors for the respondent
Hearing details:
Coffs Harbour
2015
16 December
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